yeh i'll agree with what david said about the domestic demand for australia,

Just yesterday, we had some big announcements of our trade balance surplus of 400mil and big drop in retail sales of 1% in june, you can say that one cancels the other but many ppl are starting to feel that it will be a time for a rate cut, so it'll be interesting to see what happens.

In my opinion, i was amazed how we can even get a trade surplus even when there are high interest rates (which will lead up to a stronger currency and by theory, exports should become less attractive) and high commodity prices. I guess it was offset by australia's unique location in the world with its vast resources and the growth of china n india.

By the way, the RBA of Australia meets next tuesday in whether to decide to cut rates or not.

best regards,
Peter